Digital Economy Strategy Is Government's Penske File

Industry Minister Christian Paradis recently delivered a speech that promised to provide an update on the government's digital economy strategy. To the dismay of many, the speech said very little beyond a couple of jokes and a promise to address issues such as foreign investment rules for telecom in the near future. The focus on humour in the speech is apt given that movement on the Canadian digital economy strategy seems to be taken straight out of a sitcom.

The lack of movement on the digital economy strategy is the government's "Penske File" -- the source of considerable discussion and much "work," but thus far few tangible results. (For non-Seinfeld watchers, the Penske file has become synonymous for a non-existent work project.)

Most of Canada's trading partners have had digital economy strategies in place for years, using the policies to set goals for connectivity, guide investments in networks and digital infrastructure, as well as
establish legal frameworks to provide privacy protection and enhance consumer confidence in electronic commerce.

Canada has lagged behind with no real policy direction. In May 2010, then-Industry Minister Tony Clement conducted a national consultation on the issue, yet 18 months later, there is still no strategy in sight.
There has admittedly been an election and a cabinet shuffle, but as Canada dithers, other countries move ahead with a broad range of initiatives.

Countries such as Japan, Germany, and Australia have all established ambitious targets for broadband connectivity, employing a mix of public dollars and regulatory incentives with the goal of establishing
universal access to affordable, fast connectivity. The Canadian Radio-television and Telecommunications Commission has set a target of universal access to 5 Mbps broadband by 2015, but a report last week
indicated that hundreds of thousands of Canadian households currently only have access to much slower speeds.

In the United States, the Federal Communications Commission recently teamed up with cable and technology companies to launch Connect-to-Compete, which promises to bring computers and Internet
access to low-income households. The program includes a commitment from the cable companies to offer to $10 a month broadband Internet access to homes with children that are eligible for free school
lunches. Moreover, Microsoft has committed to offering low-cost personal computers and Morgan Stanley has pledged to develop a microfinance lending program for community-based financial institutions.

Digital strategies are not limited fostering greater Internet access. In Europe, the European Commission recently adopted a recommendation on digitization that will lead to investing billions in digitization initiatives. The strategy includes a plan to make 30 million works freely available online as well as develop legal frameworks to facilitate greater access to online materials.

Ireland has focused on copyright reform as a means to jumpstart its digital economy. Unlike Canada, which has emphasized restrictive digital locks, Richard Bruton, the Irish Minister for Jobs, Enterprise
and Innovation, has promised to remove barriers to digital innovation by considering greater copyright flexibility through the adoption of a fair use provision.

The net effect of these initiatives is that other countries have stopped talking about digital economy strategies and actually introduced and implemented them. In Canada, the opposite is true.

Plans for the forthcoming spectrum auction, which holds the promise of injecting new competition into the wireless and mobile broadband markets, remains shrouded in secrecy. Legislative initiatives such as
new privacy rules are stuck in neutral in the House of Commons. Anti-spam laws are in limbo as the government may cave to lobbying pressure to water down tough new penalties.

Few would dispute the need for a national digital economy strategy, yet in the spirit of Seinfeld, the Canadian approach appears to have turned the matter into a strategy about nothing.